The surge in our currency this week to a five-month high against the United States dollar and a record high against the euro highlights how we are losing in a race to the bottom.

Britain, Europe and the United States are determined to print more money to devalue their currencies to protect their own economies.

US Federal Reserve chairman Ben Bernanke vowed to keep US interest rates at zero per cent until the end of 2014, a full year longer than previously indicated. Even now talk is emerging from within his own monetary policy-making committee of the need for a third round of money printing later this year.

The European Central Bank is now widely expected to lend another €1 trillion to its banks on February 29 to calm financial markets and bolster Europe's battered banking system.

Much of that money is being recycled into European government bonds and is even being squirted into currencies such as ours in the form of buying covered bonds being issued by our banks.

This is a massive injection of cash printed out of the ether and pumped into the European economy.

This Northern Hemisphere strategy of print and hope is fine and understandable for them. Their export sectors become more competitive and they can preserve or create jobs in exporting and import substitution. But it is in effect a beggar-thy-neighbour strategy in which investors can borrow at near zero per cent interest then buy assets in higher interest rate currencies to make an easy profit. It is fuelling a surge in cash around the globe on a hunt for hard assets such as farmland, mines and oilfields.

It creates an enormous game of musical chairs in the currency markets. It means that the last one to print and devalue is the loser.

New Zealand, with Australia and some other commodity-driven nations such as Brazil and South Africa, should now be increasingly nervous about being the last one left standing.

Continued below.

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Yet Prime Minister John Key and Finance Minister Bill English seem remarkably relaxed. Key and English said this week there was little they could do about what they see as an inevitable surge higher in the currency. Key even said exporters should get used to a currency over US80c and said a high currency was great news for consumers. Again, consumers and voters are getting priority over exporters.

He even said one of the reasons for the rise was that investors in China were attracted to the higher interest rates on the assets in our currency. He could have been talking about the sale of New Zealand land to those able to borrow money overseas at near-zero interest rates.

New Zealand's manufacturing exporters , should now be very worried. The print-and-hope strategies look set to leave anyone who doesn't follow suit sprawling in the dust.

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We saw the inevitable results of that with yet another collapse of a manufacturing exporter this week. Auckland's Criterion Furniture called in the receivers after a decline in exports into these markets. There are now 180 workers wondering if they will keep their jobs.

They are the ones left standing. How long before New Zealand has to join the game? And can we afford to stand by and just let it happen to us? Our Government seems comfortable as a spectator. At some point it may have to become a player.

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Bernard Hickey is the publisher of Hive News, a Wellington-based political and economic subscription news email service. He also writes for Interest.co.nz and appears regularly on Radio New Zealand, Radio Live, TVNZ and TV3. He has been a financial journalist for 25 years, having worked for Reuters, the Financial Times Group and Fairfax Media.